Covid-19 Benefits and Support Guide

The coronavirus outbreak has already cost thousands of people their jobs, and many of us are now facing a precarious financial future. If you’ve found yourself out of work as a result of virus-related staff cuts, are off sick, self-employed, or simply want to change jobs, then knowing what benefits and support you’re entitled to is crucial.

Given the situation, the government has had to amend existing procedures, as well as introduce new ones. This means claiming the right aid and support might not be as clear as it was previously (although it’s arguably never been that straight forward).

Perhaps you’re looking to claim for the first time, or want to know what’s changed if you’re already jobseeking. Whatever your situation, we’ve rounded up all the key essentials, as well as their eligibility requirements, to help you get an idea of what you might be entitled to, and how to get it.

Jobseeker’s Allowance

There are three different types of Jobseeker’s Allowance, and they may or may not also entitle you to Universal Credit. Before we look at Universal Credit, let’s start with the different JSA options. They are:

Contribution-based JSA

You’ll be eligible for this option if you’re severely disabled, and able to claim the severe disability premium. You’ll also need to be actively looking for employment, be able to work, and have the right to work in the UK.

Income-based JSA

To qualify for this option, you’ll need to be already eligible for the severe disability premium as with Contribution-based JSA. Income-based JSA is almost the same, with the key difference being you’ll to be single (or have a partner that doesn’t work more than 24 hours in a week), and not have more than £16,000 in savings. Do note that the savings amount does include your partner’s too.

‘New Style’ JSA

This form of JSA is claimable if you’ve been working as an employee for the last few years, and have been actively making Class 1 national insurance contributions. Any income or savings from your partner won’t affect your claim either. It is worth noting that you won’t be eligible for this if you are or have been self-employed recently (more on what you can apply for if you’re freelance/self-employed below).

Universal Credit

Now you’ve identified which form of JSA you can apply for, you should then check whether you can also qualify for Universal Credit. Generally, if you fit the following criteria, you have a good chance of being accepted for this in addition to your JSA.

You live in the UK

You have less than £16,000 in savings (note that Universal Credit assessment includes your partner’s savings as well)

You’re over 18

You’re not working or on a low income

There are also a few additional things to take into account. If you live with your partner, then their income will also need to be provided in addition to any savings they might have. Universal Credit is certainly worth applying for, as you could receive additional benefits that help cover the costs of children and rent, and JSA probably won’t cover these costs by a long shot.

As a result of the coronavirus outbreak, Universal Credit payout amounts will increase from the 6th of April temporarily. Below are some guideline figures, based on one standard household allowance per month and including the maximum additional £86.67 increase. These amounts will vary based on your circumstances, but should give you a rough idea of what to expect.

It’s also important to note that you can apply for Universal Credit online. Given the current situation, you generally won’t have to verify your identity straight away due to the huge increase in applications. This is now being done at a later date via a telephone interview.

Statutory Sick Pay

If you’ve been unlucky enough to be off sick as a result of the coronavirus, then you’re entitled to statutory sick pay. This comes in at £94.25 a week. The government has also changed the way it works to some extent, in that you can claim any statutory sick pay immediately from day one of being off sick, if you’re eligible. What’s more, you’ll also get retroactive payments from the 13th March.

Should your employer ask for evidence that you’re ill with coronavirus, simply contact the NHS on 111, and they’ll be happy to provide you with an isolation note. If you’re a freelancer or working on a zero-hours contract, then you might still be able to claim. The government’s guidelines for claiming are:

Being classified as an employee

Being ill for at least 4 days in a row

Earning an average of at least £118 a week

If you’re not able to get sick pay, then you can still apply for Universal Credit, as above.

Self-employment Income Support Scheme

This is a concerning time for freelancers, that’s for sure, and it’s highlighted just how little support is really in place for those of us that are self-employed. The government has, however, taken steps to ensure that freelancers and gig workers get additional support.

First of all, take note that you can apply for, and claim, Universal Credit as a self-employed person, provided that you can show:

Your self-employment is your main form of employment and income

You expect to make a profit from your work

You get regular work as a freelancer

You have invoices, receipts, accounts, etc.

One major amendment the Government has put in place for the moment is the removal of the minimum income floor, which is essentially what someone your equivalent age would earn as a minimum wage. You also won’t need to physically go into a jobcentre now to prove you’re self-employed.

The main form of support for freelancers during the crisis is the Self-employment Income Support Scheme. This comes in the form of a grant that covers 80% of your profits per month, capped at £2,500 per month.

There are a few problems with this, however. First of all, you have to wait for HMRC to contact you about this scheme, as there is no way to apply directly. HMRC are aware of everyone with self-employed status however, so as long as you’ve submitted a 2018/2019 self-assessment return you should receive some information about the scheme soon.

The other problem is that the Government aren’t releasing any grant payments until June. That’s a long way off, and could make things extremely difficult if you’re relying on a now non-existent freelance income. You should absolutely check if you can claim Universal Credit as soon as possible as a result.

Furloughed

The Government’s Coronavirus Job Retention Scheme is now in place, which means that the State will help businesses to cover employee salaries by 80%, up to a maximum of £2500 per month. A number of businesses are already planning to take advantage of this scheme. It means that as an employee, you will be ‘furloughed’ – still technically employed by your company, even though you won’t be required to work until the crisis passes.

There are a few things to note here:

Employers choose who fits the definition of a furloughed worker. If the job you do is essential to the company, and can be done remotely, you probably won’t be furloughed.

If you were laid off before March 19th as a result of the coronavirus, perhaps because your employer panicked and let staff go, then you can be re-hired and furloughed. Although perhaps unlikely, it’s certainly an option worth considering.

When furloughed, your wages are still subject to normal tax and national insurance deductions.

While the State will cover 80% of your wages up to £2500 per month, the additional 20% top-up by your employer is optional, so you may not receive your full salary.

The furlough scheme is currently set to run until October 2020.

Changes will come into place in August, which will allow employees to work part-time while employers still claim furlough. Employers will be expected to cover 20% of wages from August, as the government will drop their contribution to cover 60% of employee wages. This means employers must add a 20% top-up to reach the 80% wage coverage currently in place, although the additional 20% top up is likely to remain optional.

A cut off date for furlough application (for employers) is currently under review and likely to be announced soon.

If you’re on a zero-hour contract or you have different earnings every month, then the amount you receive will be decided based on either your average earnings last year, or your earnings in the same month last year.

Mental Health

Job hunting and applying for benefits is stressful enough in normal times, let alone in the current climate. Getting stressed and anxious in this kind of situation is totally normal and understandable. Know that you’re not alone. If things are proving challenging and you’re finding it hard to cope, these resources could help: